Re: Tierred pricing (was Tiger tools...)

[rob@xxxxxxxxx]

Brad,

Good analogy.  One of our divisions is capital intensive.  We have one
customer we don't make much money off of but we do produce a lot of
product.  Helps cover the "burden" while we go hunt for profits.

Rob Berendt

==================
"They that can give up essential liberty to obtain a little temporary
safety deserve neither liberty nor safety."
Benjamin Franklin



                    Brad Jensen
                    <brad@elstore.com>        To:     midrange-l@midrange.com
                    Sent by:                  cc:
                    midrange-l-admin@mi       Fax to:
                    drange.com                Subject:     Re: Tierred pricing 
(was Tiger tools...)


                    10/30/2001 05:25 PM
                    Please respond to
                    midrange-l








rob@dekko.com wrote:
>
> But if they need to gouge the larger machines in order to subsidize the
> smaller customers then they must be losing money on the smaller
customers.
> If so, then why market to them at all?
>
> Rob Berendt

I hate to go back to the income tax analogy, but that's exactly
what heppens there also. You market to the small guys because
there are a lot of them, and even if they aren't very
profitable, they keep the cash machine going and pay the rent
whil you hunt down and kill the big game to make a profit. You
would have to charge the big customers even more , if you didn't
have the little customers to spread your marketing costs over.
Some of the small ones also become big ones later, so you make
them a customer when it is easier and cheaper to do so, and you
are already there entrenched when they become big.

Of course, I'm too stupid to do this, which is why I don't make
a big profit, but hey I've got good software!

--
Brad Jensen brad@elstore.com
President
Electronic Storage Corporation Tulsa OK USA
918-664-7276

LaserVault Report Retrieval & Data Mining
www.Laservault.com

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